Legendary investor Warren Buffett advises to be greedy when others are greedy, and to be greedy when others are afraid. One way we can try to gauge the level of fear in a particular stock is with a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale from zero to 100. A stock is considered oversold if the RSI reading drops below from 30.

Start Slideshow: 10 Oversold Stocks You Should Know About ยป

In trading on Tuesday, McDonald’s shares entered the oversold territory, hitting the RSI reading of 28.6, after trading as low as $240.65 a share. By comparison, the current RSI reading for the S&P 500 ETF is 28.9. A bullish investor can look at today’s MCD RSI reading of 28.6 as an indication that the recent heavy selling is in the process of exhausting itself, and start looking for entry point opportunities on the buy side. The chart below shows the one year performance of MCD stocks:

Looking at the chart above, the lowest point for the MCD in the 52-week range is $217,675 per share, with $271.15 as the 52-week point – compared to the last trade of $240.19. Discover 9 more oversold stocks you need to know ยป